Peter Schiff accuses Michael Saylor of misleading STRC buyers
Peter Schiff says Strategy’s STRC preferred stock buyers may have legal grounds if Michael Saylor’s marketing did not adequately disclose the risks. STRC has fallen to about $82.53, roughly 15% below its $100 par value, after a June rebound to around $86.97.
Schiff argues retirees and income-focused investors who bought STRC after Saylor promoted its yield could sue if disclosures were insufficient. He also claims the sharp drop could raise dividend and fundraising pressure, making future issuances more expensive as investors demand higher yields.
The liquidity debate is intensifying. Market maker QCP estimates Strategy’s current liquidity may cover dividend payments for only about 7.5 months. QCP links this to Strategy repurchasing nearly $1.5B of 2029 convertible notes, raising about $200M via MSTR share sales, and continuing Bitcoin accumulation.
Schiff extends the critique beyond STRC to Strategy’s broader Bitcoin strategy and argues the “per-share” impact weakened after Strategy bought 1,550 BTC for about $101M in early June. He also highlights insider activity: a Strategy director (Jarrod Patten) exercised options for 1,500 Class A shares, then sold 55,750 MSTR shares in recent months for nearly $9M.
Strategy and Saylor had not publicly responded to the allegations as of the article’s deadline.
Bearish
Schiff’s accusations centre on STRC trading far below par and on whether dividend obligations can be sustained. That combination typically increases perceived credit/dividend risk, which can spill over into sentiment around Strategy’s wider capital structure and its Bitcoin-linked narrative. Similar to past moments when large structured products trade materially below terms (e.g., preferreds or debt-like instruments widening in yield), traders often shift toward risk-off positioning, watching for forced capital actions and liquidity stress.
Short term, the headline can pressure STRC (and closely related Strategy/MSTR attention) and increase volatility as investors reprice dividend coverage and disclosure risk. Long term, if liquidity constraints persist or fundraising costs rise, markets may discount the equity-like exposure tied to BTC accumulation, keeping rallies more fragile until funding mechanics stabilise. However, because this is an accusation with no cited regulator enforcement in the article, the bearish impact may be strongest on flows and sentiment rather than fundamentals immediately.